If your company wishes to conduct regulated activities under the SFA, it must hold a CMS licence. Individuals conducting regulated activities on behalf of CMS licensees or exempt CMS entities (such as banks) need to be appointed as .
These regulated activities are:
- Dealing in capital markets products
- Advising on corporate finance
- Fund management
- Real estate investment trust management
- Product financing
- Providing credit rating services
- Providing custodial services for securities
Capital markets products include securities, units in a collective investment scheme (CIS), over-the-counter (OTC) derivatives, exchange-traded derivatives and spot foreign exchange for the purposes of leveraged foreign exchange trading.
Companies which may be required to hold a CMS licence include the below. Learn more about each type of entity for more information on what they do, and the different licensing exemptions available for the different regulated activities:
When assessing an application for a CMS licence, MAS takes into account factors such as:
- Fitness and propriety of the applicant, its shareholders and directors.
- Track record and management expertise of the applicant and its parent company or major shareholders.
- Ability to meet the minimum financial requirements prescribed under the SFA.
- Strength of internal risk management and compliance systems.
- Business model/ plans and projections and the associated risks.
Your company will also need to appoint the following individuals:
- Minimum of 2 directors, at least one is resident in Singapore.
- Chief Executive Officer with least 10 years of relevant experience and is resident in Singapore.
- Minimum of 2 full-time Singapore-based individuals for each regulated activity (minimum of 3 for retail LFMC and REIT managers). Such individuals are required to be appointed as under the SFA.
|Types of CMS Licence Holder||Base Capital Requirements||Other Financial Requirements|
|Broker-dealer||The base capital requirement ranges from S$50,000 to S$5 million, depending on the types of products offered, clientele type, whether the broker-dealer is a member of an approved clearing house or exchange, if it carries any customers’ positions in its books or handles customers’ money or assets or enter into transactions with customers as principal.
If the broker-dealer is licensed to conduct more than one regulated activity, the highest base capital requirement among all its regulated activities will apply. For example, if the broker-dealer conducts dealing in capital market products that are securities, units in a CIS or exchange-traded derivatives contracts as a clearing member (where the applicable base capital requirement is S$5 million) and product financing (where the applicable base capital requirement is S$1 million), it will be required to maintain a minimum base capital of S$5 million.
A broker-dealer is required to maintain financial resources which are in excess of its total risk requirements.
A broker-dealer which is licensed to conduct product financing or which offers contracts for differences or spot foreign exchange contracts for the purposes of leveraged foreign exchange trading is required to collect margins from the investors.
|SCF operator||The base capital requirement ranges from S$50,000 to S$1 million, depending on the types of products offered, clientele type and whether the SCF operator handles customers’ moneys or assets or enter into transactions with customers as principal. If the SCF operator is licensed to conduct more than one regulated activity, the highest base capital requirement among all its regulated activities will apply.||A SCF operator is required to maintain financial resources which are in excess of its total risk requirements.|
|Corporate finance adviser||
The base capital requirement is S$250,000.
If the corporate finance adviser is licensed to conduct more than one regulated activity, the highest base capital requirement among all its regulated activities will apply. For example, if the corporate finance adviser is also licensed to conduct dealing in capital market products that are securities, units in a CIS or exchange-traded derivatives contracts as a non-clearing or trading member (where the applicable base capital requirement is S$1 million), it will be required to maintain a minimum base capital of S$1 million.
|A corporate finance adviser is required to maintain financial resources which are in excess of its total risk requirements.|
|Credit rating agency||The base capital requirement is S$250,000.||Not applicable|
|REIT manager||The base capital requirement is S$1 million.||A REIT manager is required to maintain financial resources which are in excess of its total risk requirements.|
You can find more details on the base capital and other financial requirements in the . The base capital requirements are set out in the .
If your company is applying for a CMS licence, your company should submit under the Securities and Futures (Licensing and Conduct of Business) Regulations (SF(LCB)R).
In addition, if you hire or appoint individuals to conduct a regulated activity under your licence, you have to appoint these individuals as an appointed or provisional representative for that regulated activity.
You can refer to for more information.
MAS expects to take up to 6 months to review applications which are complete and by applicants that meet all admission criteria.
Applications may take longer if:
- the applicant does not fully meet relevant admission criteria,
- has unique and complex business models, or
- does not submit all necessary forms, information and documents in the initial application.
The applicant should also expect a longer review period if it makes significant changes to its initial application. MAS may require a fresh submission in such situations.
An in-principle approval (IPA) is issued to successful applicants at the conclusion of our review process, and the applicant has up to 6 months to fulfil specified requirements for licensing or registration. As soon as the applicant meets these requirements, MAS will grant the licence or registration. MAS reserves the right to rescind the IPA if the applicant does not fulfil the requirements within the timeline, or if there are changes to the applicant’s business plan and/or key persons after IPA has been issued. At its discretion, MAS may extend the IPA by a further 3 months if there are strong reasons to do so.
There are two types of annual fees –
(i) annual fees for the CMS licence; and
(ii) annual fees for the representatives appointed by the CMS licensee.
The annual fee is the sum of the annual fees payable across all regulated activities of a CMS licensee.
|Type of Regulated Activity||Annual Fixed Fee||Variable Annual Fee|
|Dealing in capital markets products||The annual fee ranges from $2,000 to $8,000, depending on the type of capital markets products offered and whether the CMS licensee is a member of an approved exchange or clearing house. For example, if a broker-dealer deals in securities and is not a member of the Singapore Exchange Securities Trading Limited, the annual corporate fee payable is S$4,000.||$5 per representative from the 101st representative onwards as at 1 January of the calendar year.|
|Advising on corporate finance||The annual fee is $4,000.|
|Product financing||The annual fee is $2,000.|
|Providing custodial services||The annual fee is $2,000.|
|REIT management||The annual fee is $4,000.|
|Providing credit rating services||The annual fee is $4,000.|
The CMS licence is valid until:
- The licensee stops conducting all the regulated activities on the licence, and the licence is cancelled by MAS.
- The licence is revoked by MAS.
- The licence lapses in accordance with .
All entities that are holding a CMS licence to conduct regulated activities are listed on the . Correspondingly, all entities that cease to hold a licence will be removed from the Financial Institutions Directory.
If your company already holds a CMS licence for certain regulated activities and wishes to add another SFA-regulated activity to the CMS licence, you should submit under the SF(LCB)R. There is a non-refundable application fee of S$500 payable via GIRO. The CMS licensee will also have to appoint individuals who conduct the additional regulated activity as its representatives. The CMS licensee and its representatives will have to comply with relevant capital and conduct requirements applicable to its regulated activities under the SFA.
If a CMS licensee also intends to provide financial advisory services to its customers, it will have to lodge a notification for commencement of business as an exempt financial adviser (using under the Financial Advisers Regulations), and appoint the individuals who provide financial advisory services as its . The exempt financial adviser and its financial advisory will have to comply with the relevant conduct requirements under the .
For more information on the common approvals, notifications and other regulatory submissions relevant to REIT managers, please refer to the .
For more information on the common approvals, notifications and other regulatory submissions relevant to capital markets services licence holders other than fund managers and REIT managers, please refer to the .